BTN Europe presents an overview of business travel and MICE predictions for this year
Virtual Event - 1 October 2020
ExCeL London - 22-23 June 2021
ABTN talks to Paul Tchen, general manager of the Peninsula Shanghai, about the new hotel and Peninsula's future plans.
How are things in Shanghai?
Booming. We're hosting the World Expo at the moment and Shanghai has been designated the financial centre of China, which has brought a lot more focus on to our city. The Bund, where we are located, reopened in March after being closed for about a year and offers a lot more pedestrian walking space on the promenade. It has reduced the number of lanes on the Bund, which is wonderful because now it's a lot more friendly - in the past there were ten lanes on the Bund and no matter how people phrase it, ten lanes is not a street, it's a highway. The authorities have done a very good job in revitalising the Bund, and we're fortunate to be right on it.
You opened last October. Was it a tricky time to launch a luxury hotel given the financial climate?
If you look at the numbers in China, during this economic crisis there have been some challenges but China keeps on growing. Whereas a lot of countries experienced very unfavourable economic situations, China experienced reduced growth but not negative growth, and people still prospered. If you look at Shanghai, we've noticed a very strong appetite for luxury. Luxury cars are definitely a big sector - Rolls-Royce, Bentley have incredible growth. If you look at luxury fashion and brands, Chanel opened its China flagship in our hotel and it is its most beautiful store in the world. Ralph Lauren and Berluti have also opened flagship stores in the hotel, and Graff Diamonds has opened its first store in China here. The brands are recognising that the future is here, because in terms of mass alone this is the largest growing market in the world.
All the same, did you have to adjust room rates?
As a company we've had to look at each market separately because rates have been an issue. A lot of companies have adjusted their travel policies and we have had to react to that. In some destinations we've had to reduce them a little more than others. In Hong Kong, the rates are doing well because people are doing a lot of regional travel. In Chicago, which is a very domestic market in the US, during the crisis we took a very big hit. But it's a cycle we go through and this is not the first time we've experienced financial crisis - we had SARS, we had the Asian financial crisis, we survived through all of them and to us this is just another cycle.
What measures are you taking to attract business travellers?
For the business traveller, what's really important is the technology. We've recognised that so we have wired and wireless internet, we have power plugs on the desk itself, we have a data cable that they can connect to their computers to print their documents in the room. The desk itself is your office, and you have a fax, printer and copier in your room so you never have to go to the business centre. We also have 24-hour laundry but it's actually a six-hour service - if you give us your laundry, within six hours it will be back in your room. So if you happen to arrive at 1am it will be back by 7am or even earlier, and we'll put it back in your room without waking you if you are sleeping. We also offer a complimentary VIP phone which enables you to make long-distance calls for free on the internet.
Was the environment a key consideration when planning the hotel?
Yes, we built the hotel with a lot of green issues in mind. Most hotels implement new measures but we found that first you have to make sure you build a property that enables you to do a bit more. For example, laundries generate a lot of steam and we've worked out a programme where we take the steam and recycle it to heat up parts of the hotel. We also look at procurement procedures to see how we can help the environment by buying from the right producers. When you look at environmental friendliness you have to look at every step - of course we recycle paper and tin cans, we make donations to other places, we cut up old bed sheets into cloths for cleaning. But as a responsible company you have to go beyond those things.
How does the Shanghai hotel industry compare to other places you've worked?
Shanghai is very interesting because it's still a growing industry. There's a lot of hotels here and having worked for Peninsula in Beverly Hills and Hong Kong, I would say the Shanghai hotel industry is very creative - they try to find ways to be a little different, for example by working with the local authority to promote certain things. At the moment, the hotels are working very hard with the Expo authorities to embrace it and incorporate it into all the properties. There's a strong spirit of collaboration between the hotel industry and government to promote the destination, and the hotels work closely together.
What's next up for Peninsula?
Our tenth hotel will open at the end of 2012 in Paris, our first European property. Someone asked us - why Paris first and not London? And the answer was - location, location, location. Give us a fantastic location in London and we'll open there - we've always wanted to do it and we constantly look at it. The day we are able to secure a fantastic location we'll go for it. Obviously Buckingham Palace is unavailable! But once we have a viable building we have to see if we can build a Peninsula hotel within it - there aren't many properties in London where you can take down the building and rebuild a new one.
Is that what you do then?
We actually like heritage buildings, but they're not always easy to work with. We have a very nice footprint for our hotel rooms and the way you lay out a hotel is dependent on the existing structure, and in the end on the windows, because they determine where you put rooms. But we have a good mix of both - in Hong Kong, New York and Paris we have heritage buildings. The new builds are built with the local destination in mind - they fit in with the local scenery, they don't stick out like a sore thumb. They feel like they belong in the city, and that is very important to us because our hotels are only successful if they are embraced by the local community.
What about the Shanghai property?
We designed it to fit with the architecture of the Bund, but we were not reproducing an old Bund building - we wanted a building that was made today but that was timeless. So the objective was to create a building that would fit on the Bund and pay homage to the golden age of Shanghai. I think we've been able to achieve this because we keep hearing from guests - what was this building before and when did you renovate it? That's the best compliment for our architects because they were able to capture the essence of Shanghai in the building and that is always a gamble.
Where else would you like to expand?
We would like to have something in India because it's a strong growing market - either Mumbai or Delhi because we only focus on primary destinations. It would be nice to go Down Under - we've always wanted to have something in Sydney - and maybe one or two other key destinations in China because it's a very big market.